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How Much Would You Offer...

Started by janus7
almost 17 years ago
Posts: 13
Member since: Mar 2009
Discussion about
...for a three-unit house in Astoria, Queens. Top unit is 2BR, earns $1500/mo. Middle-unit is 2BR, earns another $1500/mo. And the bottom unit is 1BR, earns $1100/mo. Plus a garage that earns $150/mo. renting out to local BMW owner. Has beautiful backyard, but otherwise not exactly the lap of luxury. 5 minute walk to Ditmars Blvd train stop on N. So, that's $4250/mo in rental income. Should I use the model that says monthly rental income is 1% of value of property ($425,000)? Or, a post-expense cap rate of 6% ($680,000)? Or should I use 15x annual rent ($765,000)? Bueller? Bueller? Anyone?
Response by w67thstreet
almost 17 years ago
Posts: 9003
Member since: Dec 2008

excuze me? I believe i speak your language of slumlord... the answer lies not in any one purchase rule... BUT WHERE ARE RENTS GOING FORWARD, the rest is just bullshit #s. BTW the person who can guess this most correctly wins a 10% yielding asset otherwise it's called Bankruptcy.... FWIW I think an orange acct backed by the FDIC at 2% aint' so bad considering I am terrible at the guess how fat this gal is at the carnival.

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Response by janus7
almost 17 years ago
Posts: 13
Member since: Mar 2009

Alright, let's make a simplifying assumption and say rents will rise 1% a year for the next thirty years. (Nobody, admittedly really knows.) Under those circumstances, where's a good place to figure out a valuation for an investment?

Not comps, that's for sure.

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Response by 30yrs_RE_20_in_REO
almost 17 years ago
Posts: 9913
Member since: Mar 2009

How much should I offer for this lime green leisure suit?

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Response by w67thstreet
almost 17 years ago
Posts: 9003
Member since: Dec 2008

It's all $4.99 at goodwill. Lime or purple, don't matter.

Slumlord, cannot assume 1%, when is it going down 10% in NYC right now.

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